This is a complementary feature to enhance the shopping experience rather than a substitute for (BNPL), which we previously read about. BNPL encourages people to buy what they want right away, while SNBL encourages saving money first before making a purchase.
Users of SNBL apps can deposit funds on the platforms to save money for the next payments. The apps store this money in a variety of financial instruments before releasing them to the user for any purchases or goals they have set. The best thing about these applications right now is that they provide a variety of discounts on purchases made through their platforms. Either the merchants (a person whose business is buying and selling or bartering) or the SNBL applications themselves offer these discounts. In conclusion, these apps allow you to avoid credit while also enabling you to purchase your favorite goods at lower prices.
For a better understanding of what SNBL is let’s look at this example :
Consider the scenario where you need to purchase something for one lakh rupees after 1 year. There are 3 options to choose from:
- First, you can buy it using a credit card or by opting for BNPL and pay back the lender in 10 installments.
- Second, the traditional way is where you save money in a bank in a savings account or fixed deposit and wait for it to grow to 1 lakh and then buy.
- Third, the SNBL way is where you pay in installments directly to the merchant and not to a bank. In return, the merchant gives you a nice discount which can go around 10%.
The save Now Buy Later (SNBL) model has few benefits, in that users can save money with merchants and take advantage of the discounts. It appears to be a more transparent and user-friendly solution, but there are drawbacks as well, including the fact that the money is going to a merchant who might get into a dispute and no longer honor the installments you have paid, the merchant might go out of business, and number three, if you change your mind halfway through you, can withdraw the money but won’t get any interest.
Save Now Buy Later (SNBL) is still a new trend with little exposure, but for consumers who are organized, aware, and prepared to take some risks by going straight to the merchant, as well as those who are clear about their goals and purchases, this might be an interesting alternative for them.
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